SemGroup, Chesapeake, Gavilon form JV to build Oklahoma crude pipeline

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02.21.2012 |

A venture between SemGroup, Gavilon Midstream Energy and a Chesapeake Energy affiliate plans to build a 210-mile pipeline in western and north central Oklahoma to deliver crude oil to a storage facility in Cushing, Okla. Construction should begin in July and service is expected in the 2013 third quarter.

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By MELODIE WARNER

The pipeline will have an initial capacity of 140,000 bpd and could have a maximum operating capacity of 180,000 bpd with the addition of more horsepower.

Construction should begin in July and service is expected to start in the third quarter of 2013.

Financial terms weren't disclosed.

SemGroup provides midstream services and Chesapeake produces oil and natural gas. Gavilon Midstream is a unit of Gavilon Group, a commodity-management firm.

Plains All American Pipeline in October publicly announced its unsolicited offer to buy SemGroup for $1 billion public after SemGroup rejected the bid.

SemGroup has since adopted a poison pill with a 10% trigger to guard against hostile takeover attempts.

Dow Jones Newswires

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